Michigan House Passes Online Gambling Bill

A bill that would pave the way for internet and sports betting, sponsored by state Rep. Brandt Iden (l.), recently passed the Michigan House in a 68-40 vote. Iden said he'll refine it this summer to have ready for a Senate vote this fall. The bill does not include major leagues' integrity fee

The Michigan House of Representatives recently voted 68-40 to pass three internet gambling bills that could pave the way for legalizing sports betting. In particular, HB 4926, sponsored by state Rep. Brandt Iden, includes language that would allow the Michigan Gaming Control Board to create regulations for internet and mobile sports betting. “We all know that sports betting is coming and this sets the framework for the gaming commission. But realistically, I don’t think they’ll do that that until we have laws for the brick-and-mortar casinos in place,” Iden said.

Iden’s bill would require Detroit’s three casinos and 23 tribal casinos to pay $100,000 for an online gaming license application, then pay license fee of $200,000 and make annual payments of $100,000. The casinos would pay an 8 percent tax on gross gaming revenue from online gambling. Players would be required to be at least age 21 to register with a Michigan casino and gamble from its website.

The legislation also would establish a new division within the gaming commission dedicated to internet gaming and licensing. “People in Michigan are already gambling over the internet, but they are doing so at risky and illegal websites. The Michigan websites will have strict state oversight, unlike the illegal and unregulated sites our resident use now, at great risk to their finances and personal information,” Iden said.

Iden said he and his colleagues plan to use the summer recess to refine sports betting legislation that both chambers could pass when the legislature reconvenes this fall. Iden stated he also will work with tribal leaders throughout the state.

State Rep. Robert Kosowski, who also sponsored sports betting legislation in the House, estimated sports betting would generate $300-$500 million for the state. “I think there’s enough push for lawmakers because even if they don’t like sports gambling, maybe with this revenue we don’t raise taxes,” Rep. Kosowski said.

Iden said he also wants to talk to professional leagues regarding the integrity fee the National Basketball Association and Major League Baseball have been promoting. So far, no state has included the fee in sports betting legislation. “At the moment, I think the integrity fee is a non-starter. It’s important that all the states do something similar and I don’t want Michigan to be different or put Michigan at a competitive disadvantage.”

Michigan lawmakers also will have to address the issue of pro sports team owners who also own casinos. For example, Illitch Holdings currently owns both the National Hockey League’s Detroit Red Wings and MLB’s Detroit Tigers, as well as the MotorCity Casino. New Jersey handled the same issue by amending its sports betting law to allow wagering on sports except on the NBA at the Atlantic City casino owned by Houston Rockets owner Tilman Fertitta.

The Michigan Senate is expected to vote on HB 4926 in September. If it’s approved and signed by the governor, Michigan could become the fifth state to allow online gambling, along with Nevada, New Jersey, Delaware and Pennsylvania.